How to Form a Nonprofit Corporation in California

by Mancuso, Anthony

• ISBN13: 9780873376136
• ISBN10: 0873376137
• Edition: CD
• Format: Paperback
• Copyright: 2000-09-01
• Publisher: Nolo

Summary

How to Form a Nonprofit Corporation in California guides readers through the steps necessary to obtain Federal 501(c)(3) status in order to qualify for federal and state income tax exemptions, tax deductible contributions form donors, public and private funding and more.

This edition will help readers register their nonprofits with a $30 filing fee. Includes all forms as tear-outs and on CD-ROM.

Author Biography

Attorney Anthony Mancuso is a corporations expert

Table of Contents

Introduction
Overview of the California Nonprofit Corporation
What is a Corporation?	2	(1)
How Corporations are Labeled	2	(1)
Domestic and Foreign Corporations	2	(1)
Business Corporations	3	(1)
What Does it Mean to be ``Nonprofit''?	3	(2)
The Nonprofit Corporation Law	5	(1)
Types Of Nonprofit Corporations	5	(2)
Public Benefit Corporations---What Are They?	5	(1)
Religious Corporations---What Are They?	6	(1)
Mutual Benefit Corporations---What Are They?	6	(1)
How to Obtain Nonprofit Corporate Status---an Overview	7	(2)
Advantages of the Nonprofit Corporation	9	(2)
Tax Exemptions	9	(1)
Limited Liability	9	(1)
Perpetual Legal Existence	10	(1)
Employee Benefits	11	(1)
Formality	11	(1)
Disadvantages of the Nonprofit Corporation	11
Paperwork	11	(1)
Incorporation Costs and Fees	12	(1)
Time and Energy	12
Nonprofit Corporations and the California Corporation Law
Nonprofit Purposes	2	(1)
Nonprofit Powers	2	(1)
Corporate People---An Overview	3	(1)
Incorporators	4	(1)
Directors	5	(10)
Officers	15	(1)
Members	16	(4)
Employees	20	(2)
How Many People Must Organize a California Nonprofit Corporation?	22	(1)
How Much Money Must You Start With?	23	(1)
Dissolution of a Nonprofit Corporation	24	(2)
Voluntary Dissolution	24	(1)
Involuntary Dissolution	24	(1)
Winding Up Corporate Business and Distribution of Assets	25	(1)
Summing Up---More Questions?	26
The Federal 501(c)(3) Nonprofit Income Tax Exemption
Special-Purpose Nonprofit Tax Exemptions	2	(1)
501(c)(3) Nonprofit Tax Exemption	2	(2)
501(c)(3) Tax-Exempt Purposes	4	(9)
Charitable Purposes	4	(3)
Religious Purposes	7	(3)
Scientific Purposes	10	(1)
Literary Purposes	11	(1)
Educational Purposes	12	(1)
Other Tax Exemption Requirements	13
Insubstantial Unrelated Activities Requirement	13	(1)
Limitation on Private Inurement (Profits and Benefits)	13	(2)
Limitation on Political Activities	15
501(c)(3) Public Charities and Private Foundations
The Importance of Public Charity Status	2	(1)
Private Foundations---Background	3	(1)
Private Foundation Rules	3	(1)
Operating Restrictions	3	(1)
Limitation on Deductibility of Contributions	4	(1)
Special Types of Private Foundations	4	(1)
Private Operating Foundations	4	(1)
Private Non-Operating Foundations	4	(1)
How to Qualify for 501(c)(3) Public Charity Status	5	(1)
501(c)(3) Public Charities and their Requirements	6	(14)
Automatic Public Charity Status	6	(1)
Publicly Supported Organizations	7	(8)
The Support Test	15	(5)
Summing Up	20
Other Nonprofit Benefits and Requirements
Federal Tax Deducations for Contributions	2	(1)
Federal Estate and Gift Tax Exemptions	3	(1)
Federal Unrelated Business Income Tax	4	(1)
Activities That Are Taxed	4	(1)
Activities That Are Not Taxed	4	(1)
California 23701(D) Nonprofit Tax Exemption	5	(1)
Private Foundations VS.Public Charity Status Under California Law	6	(1)
Deductibility of Contributions on California Tax Returns	6	(1)
California Attorney General Reporting Requirements	6	(1)
California Unrelated Business Income Tax	7	(1)
Activities That Are Taxed	7	(1)
Activities That Are Not Taxed	7	(1)
California Welfare Exemption	8	(8)
Welfare Exemption Requirements	8	(1)
How to Apply	9	(1)
Special Rules	10	(4)
Leasing and the Welfare Exemption	14	(2)
Other California Tax Exemptions	16
Organizing a Nonprofit Corporation
Choose a Corporate Name	2	(1)
The Importance of Your Corporate Name	3	(1)
Secretary of State Name Requirements	4	(1)
Practical Suggestions When Selecting a Name	4	(3)
Check to See If Your Proposed Name Is Available	7	(1)
Reserve Your Corporate Name	8	(2)
Perform Your Own Name Search	10	(3)
Prepare Articles Of Incorporation	12	(1)
Prepare Articles for a California Public Benefit Corporation	13	(6)
Prepare Articles of Incorporation for a California Religious Corporation	19	(11)
Prepare Articles for an Unincorporated Association	23	(3)
File Your Articles Now or Later	26	(2)
Prepare Bylaws	28	(2)
Choose a Membership or Non-Membership Structure	30	(1)
Prepare Basic Bylaws for a Public Benefit Nonprofit Corporation	30	(10)
Prepare Membership Provisions for a Public Benefit Nonprofit Corporation (Optional)	40	(6)
Prepare Basic Bylaws for a Religious Nonprofit Corporation	46	(9)
Prepare Membership Provisions for a Religious Corporation (Optional)	55
Prepare Your California Tax Exemption Application
Prepare State Tax Exemption Application	2	(1)
First Things First	3	(1)
Filling in the Blanks on Form FTB 3500	3	(12)
Sign Your Exemption Application	15	(1)
Mail Your State Tax Exemption Application	15
File Your Articles
Consolidate Your Papers	2	(1)
Make Copies of Articles	2	(1)
File Your Articles of Incorporation	3
Apply for Your Federal 501(c)(3) Tax Exemption
Prepare and File Your Federal Tax Exemption Application	2	(3)
Do You Need to Apply for Your 501(c)(3) Tax Exemption?	5	(1)
Prepare User Fee Form 8718	6	(1)
Prepare Your Tax Exemption Application	7	(26)
Part I. Identification of Applicant	7	(3)
Part II. Activities and Operational Information	10	(8)
Part III. Technical Requirements	18	(13)
Part IV. Financial Data	31	(2)
Mail Your Tax Exemption Application to the IRS	33	(1)
What to Expect From the IRS	33
Final Steps in Organizing Your Nonprofit Corporation
Mail IRS Letter to Franchise Tax Board	2	(1)
Set up a Corporate Records Book	2	(4)
Prepare Offer to Transfer Assets (Existing Organizations---Optional)	6	(5)
Prepare Minutes of First Board Meeting	11	(8)
Place Minutes and Attachments in Corporate Records Book	19	(1)
Comply With Bulk Sales Law (A Few Existing Organizations)	20	(1)
Prepare Bill of Sale for Assets (Existing Organizations---Optional)	20	(3)
Prepare Assignments of Leases and Deeds (Existing Organizations---Optional)	23	(1)
File Final Papers for Prior Organization (Existing Organizations---Optional)	24	(1)
Notify Creditors of Prior Organization (Existing Organizations)	24	(1)
Apply for Nonprofit Mailing Permit (Optional)	24	(1)
Apply for Property Tax Exemption (Optional)	25	(2)
File Domestic Corporation Statement	27	(1)
Register With Attorney General (Public Benefit Corporations)	27	(1)
Issue Membership Certificates (Membership Corporations---Optional)	28	(1)
File Articles With County Recorders (Certain Existing Unincorporated Associations)	28	(1)
Register With Fair Political Practices Commission (Political Groups)	29
After Your Corporation Is Organized
Federal Corporate Tax Returns	2	(3)
Annual Exempt Organization Returns for Public Charities	2	(1)
Annual Exempt Organization Return for Private Foundations	3	(1)
Annual Exempt Organization Unrelated Business Income Tax Return	4	(1)
California Corporate Tax Returns and Reports	5	(2)
Annual Exempt Organization Returns for Public Charities	5	(1)
Annual Exempt Organization Return for Private Foundations	5	(1)
Annual Exempt Organization Unrelated Business Income Tax Return and Quarterly Estimated Tax Payments	5	(1)
Annual Periodic Report to Attorney General by Public Benefit Corporations	6	(1)
Annual Corporate Report to Directors (and Members, If Any) of Public Benefit Corporations	6	(1)
Federal and State Corporate Employment Taxes	7	(4)
Federal Employment Taxes and Forms	8	(1)
State Employment Taxes and Forms	9	(2)
Employee Returns---A Short Note	11	(1)
Sales Tax Forms and Exemption From Sales Tax	11	(1)
Sales Tax	11	(1)
Exemption From Collecting and Submitting Sales Tax	11	(1)
Licenses and Permits	12	(1)
Workers Compensation	13	(1)
Private Insurance Coverage	13
Lawyers and Accountants
Lawyers	2	(1)
Accountants	3
Appendix 1 How to Use the Forms CD-ROM
Appendix 2 Forms
Appendix 3 Ten Stock Certificates
Index